We are in this together.
The American Bakers Association’s member companies and employees are at the heart of our operations. ABA remains committed to their safety and wellbeing. While we continue to collect information from both officials and our Members, please refer to these resources to help find relief and support during what is a tremendously trying time.
Main Street Lending Program
The Federal Reserve took additional actions to provide up to $2.3 trillion in loans to support the economy. This funding will assist households and employers of all sizes and bolster the ability of state and local governments to deliver critical services during the coronavirus pandemic. The Federal Reserve announced it’s taking expanded corporate-debt backstops to aid small businesses through their Main Street Lending Program.
The Main Street Lending Program will enhance support for small and mid-sized businesses that were in good financial standing before the crisis by offering 4-year loans to companies employing up to 10,000 workers or with revenues of less than $2.5 billion. Principal and interest payments will be deferred for one year. Firms that have taken advantage of the PPP may also take out Main Street loans.
ABA hosted, in partnership with Morgan, Lewis & Bockius LLP, a series of webinars to help ABA members navigate the CARES Act. This is a complex piece of legislation that could potentially benefit many of all of our Members, especially small to medium-sized businesses and foodservice bakers.
- COVID-19 & The CARES Act: Workplace and Tax Issues for the Baking Industry – April 17, 2020
- COVID-19 & The CARES Act: What Small Businesses Need to Know – April 22, 2020
- *Note: These webinars have been recorded and are available for free to ABA Members on ABA’s Webinar Portal.
Small Business Administration Loans
Information & Resources
In response to the economic harm that the COVID-19 outbreak has created, the government has empowered the Small Business Administration (SBA) through stimulus packages to issue loans to small businesses that meet SBA size requirements. We encourage ABA members to review available options and consult with your financial institutions to understand the option best for your situation.
While “small” businesses are generally defined as those enterprises with 500 or fewer employees, baking industry enterprises may still qualify if they employ more than 500 employees. SBA utilizes NAICS codes to identify what qualifies as a small business, below are a few relevant thresholds to bakeries:
Economic Injury Disaster Loans (EIDLs)
Designed to “provide economic relief to businesses that are currently experiencing a temporary loss of revenue,” this loan offers quick relief to applicants.
All 50 states and Washington, DC have been declared “disaster zones,” making your business eligible for this funding program.
Paycheck Protection Program
A product of the phase 3 stimulus package, the CARES Act, the Paycheck Protection Program is “designed to provide a direct incentive for small businesses to keep their workers on the payroll.”
Loan money can be used for payroll, rent, mortgage interest, utilities.
Notable loan stipulations:
- Borrowers are allowed to choose which 24 weeks loans will count towards between the period of February 15 and December 31.
- Payroll costs must comprise at least 60% of loan spending in order to be eligible for full forgiveness.
- Paycheck Protection Program Flexibility Act
- Loan Forgiveness Application and Instructions
- Paycheck Protection Program Homepage
- Click here for a one-page overview of the program
- PPP FAQ Document from Treasury Department
- Click here for a longer lender guidance document
- Affiliation Rules Regarding Eligibility
- Search Tool: Find an Eligible Lender
- How to Calculate Loan Amounts
Interim Final Rules
- Interim Final Rule on Loan Forgiveness
- Interim Final Rule on Loan Review Procedures and Related Borrower
- Interim Final Rule 1
- Interim Final Rule on Applicable Affiliation Rules
- Interim Final Rule on Additional Eligibility Criteria and Requirements for Certain Pledges of Loans
- Interim Final Rule on Requirements for Promissory Notes, Authorizations, Affiliation, and Eligibility
- Interim Final Rule on Additional Criterion for Seasonal Employers
- Interim Final Rule on Disbursements
***ABA encourages you to inquire with your banker regarding this program as there is a limited amount of funding ($349 B) available, owners hoping to take advantage of this program should start the application process with a lender as soon as possible. The Paycheck Prevention Program is only available until June 30, 2020.***